Understanding Health Reimbursement Arrangements

If you are currently participating in a Tufts Health Plan Advantage HMO or PPO, your employer may also offer a Health Reimbursement Arrangement (HRA). The HRA can be packaged with your health plan to help you pay for out-of-pocket expenses. Think of an HRA as a medical bank account—money that you can use to pay for eligible health care expenses.

What is a Health Reimbursement Arrangement?

An HRA is an account established by your employer to help you pay for out-of-pocket health care costs, such as your deductible, coinsurance, and copayments.

Who can contribute money into an HRA?

Your employer contributes money into your HRA. You may not contribute additional money into an HRA.

Will I be taxed on the money in my HRA?

No. HRA contributions are not included as part of your taxable income from your employer, saving you valuable tax dollars.

What kind of health care expenses can I use the money in my HRA for?

Eligible expenses depend on how your employer has set up the HRA. Your employer may allow your HRA funds to apply to most health care expenses, including deductibles, copayments, and coinsurance, as well as some expenses that are limited or not covered by your plan, like chiropractic visits or acupuncture. Or they may restrict the use of the HRA to cover only deductibles, copayments, coinsurance, and eligible health care expenses under your current health plan. Check with your human resources department for specific information about your plan.

Do I have to use all the funds in the HRA within a year, or will the funds carry over to next year?

That also depends on how your employer has set up the HRA. Employers have the option of keeping any HRA money that you don’t use within the year, or they can allow the money in the HRA to carry over into the following year. If your employer does not allow the money in the HRA to carry over, it is best to use all of the funds provided by this arrangement within the calendar year. Check with your human resources department to determine if your arrangement allows funds to carry over.

What if I leave my job? What happens to the money in my HRA?

There may be restrictions on using HRA funds if you leave your job, so check with your human resources department for more specific information about your plan.
 

Quick Tips to Make the Most of Your Benefits
  • Get into the habit of saving receipts and tracking expenses along with your regular monthly bill paying. Make sure your family knows to track these expenses, too. Keep them in a separate file labeled “Health Care Expenses.” At the end of the year, you can estimate how much you and your family spent per month — to give you a head start on next year’s estimate.
  • Visits with in-network providers are often less expensive than those with out-of-network providers, depending on your plan. Use our online doctor search tool to find a primary care provider or any kind of specialist, such as a dermatologist, ophthalmologist, or a therapist.
  • Be smart — compare costs and do some research to make the most of your health care dollars.
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